The Coca-Cola Company announced Friday its Bottling Investments Group will wrest control of the bottling operations in the Philippines after Coca-Cola FEMSA of Mexico decided to sell its 51-percent stake in unit Coca-Cola Philippines.
The US company said the buy-back would be subject to regulatory approvals.
“We respect Coca-Cola FEMSA’s decision, and we appreciate the progress made during their five-year tenure in the Philippines,” said Coca-Cola Company president of the Asia Pacific Group John Murphy.
The firm expressed confidence about the growth prospects of the Philippine bottling operations, adding the market was now in a better position for future success.
Murphy said the company would ensure a smooth transition of the Philippine bottling operations for all customers, business partners, consumers and workers;
Coca Cola Company Philippines president and general manager Winn Everhart noted that the Coca-Cola Company had been operating in the Philippines for over 100 years.
“In every market’s evolution, there will be ups and downs. We are confident both in the opportunities that we have ahead and in the plans we have in place for the Philippines. With BIG’s depth of experience and solid track record in Southeast Asia, we believe they will bring significant value to our business,” he said.
Meanwhile, BIG president Calin Dragan said Southeast Asia was an important market for the company and that “and we look forward to the Philippines joining our portfolio.”
“We want all customers and consumers to know that we are fully committed to ensure a seamless transition with Coca-Cola FEMSA. Most importantly, we want all employees to know that we appreciate the progress they have made in moving the Philippines business forward, and we believe that this will continue to improve as part of BIG,” he said.
BIG was created by The Coca-Cola Company to ensure that select bottling operations
receive the appropriate investments and expertise to ensure long-term success.
Coca Cola Femsa has been dealing with labor problems since late 2016. It did not confirm reports that the company was having a hard time complying to the tax reform law, especially the increase in excise tax for sweetened beverages.
Coca-Cola Femsa in August last year said it might revisit its investment plan in the Philippines, if Congress approved the proposed tax on sugar-sweetened beverages in its original form.
Coca-Cola Femsa Philippines director of legal and corporate affairs Juan Lorenzo Tañada said while the company was still committed to deliver $1 biĺlion worth of investments until 2020, the proposed tax would have an impact on its decision.
Other beverage industry players also expressed concern over the proposed tax measure and asked the government to delay by at least a year the imposition of taxes, or once the issues on health concerns and revenue generation were resolved.